Closing Analysis

Indices Gap Lower RSS

Closing Technical Market Analysis for Mon April 9th 2012

The stock market indices suffered losses today as foreign markets and futures were sharply lower before the opening, due to Friday’s weak preliminary report. The day started out with big gaps down at the opening, which resulted in a little bounce and then a retest. When they held the lows on the S&P 500, they rallied. The NDX rallied much more sharply as Apple Inc. (AAPL) went from 625 to nearly 640, during the course of the session. A pullback late in the day dropped it back to 636.23, which was anticipated due to the rising wedge patterns that occurred during the day.

Net on the day, the Dow was down 130.55, and closed under 13,000, at 12,929.59. The S&P 500 fell 15.88 to 1382.20, and the Nasdaq 100 dropped 22.52 at 2739.98.

Advance-declines were nearly 4 to 1 negative on the New York Stock Exchange and 4 to 1 negative on Nasdaq as well. Up/down volume was about 9 to 1 negative on New York, with total volume of 720 million shares traded today. Nasdaq traded about 1 1/3 billion shares and had a 5 1/2 to 1 negative volume ratio. board was almost all lower, but there were some amazing gainers today. Leading the way was Global-Tech Advanced Innovations Inc. (GAI), which exploded on the get-go, and ran up to nearly 10, closing at 8.76, up 3.54, or 68%. However, total volume was only 259,000. It was very thinly traded. AOL, Inc. (AOL), on a deal with Microsoft Corporation (MSFT) of over 1 billion, jumped almost 8 points, 7.95 to 26.37, or 43%, reaching over 27 at one point in the day, on 25.9 million shares traded.

In addition, Swing trade Vringo, Inc. (VRNG) was up 70 cents to 3.36, or 26%, reaching as high as 3.76 today, on 11.5 million shares. THT Heat Transfer Technology, Inc. (THTI) advanced 37 cents to 2.02, or 22.4%, on over 1 million shares. magicJack VocalTec Ltd (CALL) jumped 2.26 to 23.07, or 11.3%, on 1.5 million shares. E-Commerce China Dangdang Inc. (DANG) gained 94 cents to 10.67, reaching as high as 11.09, or 10%, on 11.4 million shares. Verenium Corporation (VRNM) was up 36 cents to 4.84, or 8%, and Transcept Pharmaceuticals, Inc. (TSPT) 64 cents to 11.76, reaching 12.00, or 5.7%.

Other gainers of note included Anika Therapeutics Inc. (ANIK), up 80 cents to 14.00. Titan Machinery, Inc. (TITN), which we highlighted earlier today, rose 1.79 to 29.11. Zillow, Inc. (Z) was up 1.47 to 38.55. Molycorp, Inc. (MCP) climbed 1.52 to 34.71, and Questcor Pharmaceuticals, Inc. (QCOR) added 1.15 to 41.27.

As mentioned earlier, Apple Inc. (AAPL) was up 2.55 to 636.23.

The ultra-shorts had a very good day today. The VelocityShares Daily 2x VIX (TVIX) gapped up sharply, and closed near where it opened, up 77 cents to 8.46, a 10% gain on 9 million shares. The Direxion Daily Small Cap Bear 3X Shares (TZA) advanced 91 cents to 19.36 on 16.5 million shares. The Direxion Daily Emrg Mkts Bear 3X Shares (EDZ) was up 60 cents to 13.38 on 1.6 million shares. The iPath S&P 500 VIX Short Term Futures (VXX) gained 1.12 to 18.98 on 40.6 million shares.

On the downside, Netflix, Inc. (NFLX) lost 3.82 to 106.68.

The ultra-longs got hammered today. The Direxion Daily Financial Bull 3X Shares (FAS) dropped 4.43 to 100.38, falling under 100 to 98.68 at one point in the day. The Direxion Daily Small Cap Bull 3X Shares (TNA) lost 2.99 to 56.58, on 22 million shares.

Stepping back and reviewing the hourly chart patterns, the indices gapped down sharply and then rallied for most of the rest of the day, but in a rising wedge pattern which broke in the last hour and rolled over to close negatively on the session, and may be setting us up for lower levels. It sure appears so.

We’ll have to see how it goes tomorrow.

Good Trading!


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